More than 100 Norwegian banks are to take a stake in the Vipps P2P mobile payment app developed by DNB in a bid to block competition from rival Nordic platforms and the likes of Facebook, Google and Apple.
DNB, the SpareBank 1 alliance, the Eika alliance, Sparebanken Møre and the 15 independent savings banks which also are co-owners of Frende Forsikring have signed a letter of intent, to jointly acquire a 48% stake in the mobile payment service.
DNB will retain a 52% controlling interest in Vipps, which will be spun off as an autonomous joint venture. Under the agreement, the SpareBank 1 alliance will own 25%, the independent savings banks 12%, the Eika alliance 10% and Sparebanken Møre one per cent. SpareBank 1 will transfer its mobile payment service mCASH, which delivers many of the same services as Vipps over to the new company.
Rune Bjerke, group chief executive of DNB and incoming chairman of the board of Vipps, says: "Over the course of 2017, Vipps will be available in far more places than we have seen up until now. This alliance will make us better equipped to win the race against Nordic and international market participants."
Vipps counts about 2.15 million individual users in the country and more than 30,000 corporate customers. On average 204,000 transactions are carried out daily, DNB says.
Denmark's MobilePay - which ranks Norway's largest bank Nordea as a member - claims 3.1 million subscribers in Denmark, and approximately 300,000 users in Norway.
"Several market participants are competing to launch their own mobile payment solutions," says Finn Haugan, CEO of SpareBank 1. "A lot of people find this confusing, whether they are making payments or on the receiving end. Even though we have taken a firm market position in a short amount of time through our mCASH initiative, many of our customers have expressed a preference for one solution: a single strong and distinct provider."